Brazil Set to Outsell Germany?

The land of tomorrow…today?

by on Apr.15, 2010

Though the market has become more global, Brazil has also seen the development of some unique models, like the Chevrolet Sabia.

Brazil is the land of the future…and always will be, or so goes the snarky joke about Latin America’s largest country, a nation that always seems to be so close to becoming a truly first world economy, only to see itself set back by yet another crisis.

But when it comes to the automotive industry, at least, Brazil is finally in gear and, it seems, on a fast course to overtake Europe’s largest national market, Germany – perhaps this year – according to several new studies, including one by J.D. Power and Associates.

The Brazilian market has been on a shaky march for more than a decade, set in motion by that government’s creation of the so-called “Popular Car” segment.  Originally seen as a small niche of stripped-down econocars aimed at first-time buyers hoping to improve their lives, the Popular Car segment is now a major force in the Brazilian auto industry.

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Meanwhile, IHS Global Insight reports that improving access to credit has increased the number of potential car buyers in the nation of 206 million people by 50%.

That was among the factors that helped drive Brazilian sales to 3.1 million in 2009, an all-time record.  And the number is expected to surge to at least 3.4 million this year.

By comparison, Germany, with a population of 82 million, recorded sales of 4 million last year, but Europe’s economic woes, and the lack of an auto sales stimulus program, are expected to result in as much as a 25% decline in the German car market, with 2010 volumes forecast to slip as low as an anemic 3 million, which would put the total behind Brazil.

If the forecast holds, it would mark another significant milestone in the emergence of the “Third World” as a force to be reckoned with on the automotive front.  In 2009, strong intervention by the Chinese government kept that country’s car market afloat, even as sales in the recession-racked U.S. tumbled to their lowest level in decades.  Barring an unexpected surge, China is expected to remain the world’s largest national car market for the foreseeable future.

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